Suspicion-Based Dismissal: Your Rights & Severance Pay

What is a suspicion-based dismissal?

A suspicion-based dismissal (Verdachtskündigung) is a dismissal that your employer bases not on a proven act, but solely on the urgent suspicion that you've committed a serious breach of duty or even a criminal offence. The classic case: money is missing from the till, the evidence points to you, but nobody saw anything and nothing has been proven. Your employer dismisses you anyway, because in their view the suspicion alone destroys the trust needed for continued cooperation.

You won't find the suspicion-based dismissal in the statute. It's a construct of Federal Labour Court case law that recognises the suspicion itself as an independent ground for dismissal: it's not the (unproven) act that justifies the dismissal, but the urgent suspicion founded on objective facts. This distinguishes it from a dismissal based on a proven act, where your employer considers the breach of duty established, as with the classic conduct-related dismissal.

Because someone can lose their job here without anything being proven against them, the suspicion-based dismissal is one of the sharpest and, at the same time, one of the most error-prone instruments in employment law. Courts only allow it under strict conditions, and employers frequently fail to meet exactly these conditions in practice. For you, this means: a suspicion-based dismissal isn't a verdict, it's the start of a dispute in which your position is often better than it feels at first.

Important from the start: even a flawed suspicion-based dismissal becomes final if you don't file a claim within 3 weeks of receiving the written dismissal (§ 4 KSchG). This clock starts running right now.

The strict requirements of a suspicion-based dismissal

According to Federal Labour Court case law, a suspicion-based dismissal must clear several hurdles. If even one is missing, the dismissal is usually invalid:

1) Urgent suspicion based on objective facts

It's not enough that your employer "believes you're the culprit". The suspicion must be urgent, meaning it must establish a strong likelihood that you committed the breach of duty, and it must be based on objective, verifiable facts: concrete evidence, documents, analyses, witness statements. Mere assumptions, rumours among colleagues, or a "gut feeling" on management's part are explicitly not enough. The vaguer the factual basis, the more vulnerable the dismissal.

2) A serious breach of duty or criminal offence

The suspicion must relate to conduct that, if proven, would justify a dismissal: typically theft, embezzlement, fraud, time fraud, expense manipulation, or comparably serious breaches of contract. Suspicion of a trivial matter or an everyday mistake isn't enough. For minor, correctable breaches of duty, a warning notice (Abmahnung) would in any case be the milder measure to try first.

3) Your employer must genuinely investigate the matter

Your employer has a duty to investigate: they must do everything reasonably expected of them to clarify the matter before dismissing you. This includes establishing exonerating circumstances just as much as incriminating ones, checking obvious explanations, and above all: hearing you on the accusations. Anyone who relies on the first suspicion that comes along and doesn't even examine alternatives fails to meet this requirement.

4) The prior hearing of the employee

The hearing is so central that it deserves its own section (more on that shortly). For now, the key point: without a properly conducted prior hearing, the suspicion-based dismissal is invalid according to Federal Labour Court case law. It's a condition for validity, not a mere formality.

5) Balancing of interests

Even if all the requirements are met, courts finally check whether the dismissal is proportionate in the specific case. This balancing includes, among other things: your length of service, your previous conduct, the severity of the suspicion, and the consequences of losing your job. If you've worked for many years without any complaints, that carries real weight.

If a works council (Betriebsrat) exists, there's an additional hurdle: it must be consulted before every dismissal (§ 102 BetrVG), and specifically be told that it's a suspicion-based dismissal. Mistakes in the works council consultation also invalidate the dismissal. Read more about the council's role under Works Council.

Many hurdles, many potential errors, plenty of room to negotiate: Calculate in 2 minutes with our severance calculator which severance pay is a realistic guide in your case.

The hearing: your employer's obligation, your tactics

Before a suspicion-based dismissal, your employer must give you the opportunity to respond to the accusations. The purpose: you should have the chance to dispel the suspicion before it costs you your job. For the hearing to fulfil this purpose, it must meet genuine minimum requirements:

• Concrete accusations: your employer must describe the facts to you concretely enough that you know what you're supposed to respond to. "There are some irregularities, what do you say to that?" isn't enough.
• A genuine opportunity to respond: catching you off guard in passing, or an appointment where the decision is clearly already made, isn't a hearing. If you ask, you're usually entitled to a reasonable, short period to think it over.
• Before the dismissal: the hearing must take place before the dismissal is issued. A hearing conducted afterwards doesn't cure the defect.

If your employer refuses the hearing entirely, only conducts a sham hearing, or stays so vague that you can't defend yourself, the suspicion-based dismissal is usually invalid. In practice, a flawed hearing is one of the most common reasons why suspicion-based dismissals fail before the labour court.

How should you behave at the hearing?

As strict as your employer's obligations are, it's just as easy to harm yourself in the hearing. The most important rules:

• You don't have to incriminate yourself. Nobody can force you to make statements that harm you. Staying silent is permitted. But bear in mind: the hearing is also your chance to dispel the suspicion. Whether staying silent or giving a prepared, precise statement is smarter is a tactical question that depends on the individual case.
• Get advice first, then respond. Ask for the accusations in writing and for a short period to respond. Use this time to talk to employment lawyers. A well-considered written statement is almost always better than spontaneous answers under pressure.
• Don't sign anything. No confession, no "minutes for the record", and above all no termination agreement (Aufhebungsvertrag). Hearing situations often involve pressure: dismissal and a criminal complaint on one side, a "quiet" termination agreement on the other. A termination agreement signed under pressure is hard to undo and can additionally trigger a benefit suspension period on unemployment benefit.
• Stay calm and document everything. Note down straight after the conversation who was present, what was asked, and what you answered. These notes are valuable later when it comes to the question of whether the hearing was properly conducted.

Been told a hearing is coming and unsure how to react? Start with the severance calculator and have us assess your case before you say anything.

Without notice or with notice: which form does a suspicion-based dismissal take?

In most cases, the suspicion-based dismissal is issued as an extraordinary summary dismissal: your employer relies on good cause under § 626 BGB and ends the employment relationship from one day to the next. You can read what this generally means and what rights you have then in our articles on summary dismissal and extraordinary dismissal.

Particularly important for you: with the summary variant, the 2-week declaration period under § 626 para. 2 BGB applies. Your employer must declare the dismissal within 2 weeks of becoming aware of the relevant facts. With a suspicion-based dismissal, this deadline has a particular feature: as long as your employer investigates the matter promptly, for example by evaluating documents and conducting your hearing, the deadline usually doesn't start running yet. But if your employer takes their time investigating without a comprehensible reason, the 2-week deadline may have lapsed, and the summary dismissal may be invalid for that reason alone. The timeline between first suspicion, hearing, and dismissal is therefore always worth a close look.

A suspicion-based dismissal can also be issued as an ordinary dismissal with notice period, often as an "alternative" second step: without notice, or alternatively with notice at the next possible date. If the summary dismissal fails, at least the ordinary one is meant to take effect. But the ordinary suspicion-based dismissal must also meet the requirements described above, including the hearing, and, where the Protection Against Dismissal Act (Kündigungsschutzgesetz) applies, it must be measured against its standards. Read more about this form of dismissal under ordinary dismissal.

Suspicion, criminal proceedings, and innocence: what really applies?

Many people affected assume: "As long as I'm not convicted, nothing can happen to me under employment law." Unfortunately, that's wrong. Employment law and criminal law operate independently of each other:

• No conviction needed: whether criminal proceedings are running, or how they end, doesn't matter for the validity of the suspicion-based dismissal. What counts is solely whether the employment law conditions were met at the time of the dismissal.
• An acquittal doesn't automatically protect you: even a later acquittal or the discontinuation of investigation proceedings doesn't automatically invalidate the dismissal. In criminal proceedings, "in doubt, in favour of the accused" applies, but in unfair dismissal proceedings it's independently examined whether the urgent suspicion was justified at the time the dismissal was issued.
• But: a claim to reinstatement if innocence is established. If your innocence is established after the dismissal, a claim to reinstatement may arise according to Federal Labour Court case law: your employer may be obliged to reinstate you, because the basis for the suspicion-based dismissal has fallen away. Whether and to what extent this applies depends heavily on the individual case, for example on when the exonerating evidence becomes known.

The presumption of innocence in criminal law therefore doesn't apply one-to-one in employment law. That makes it all the more important to use the employment law levers that genuinely exist: the strict requirements for a suspicion-based dismissal, hearing mistakes, your employer's burden of proof, and judicial review as part of an unfair dismissal claim.

If investigation proceedings are running in parallel, this also applies: don't make any statements to your employer, the police, or the public prosecutor without prior legal advice. Statements made during the employment law hearing can play a role in criminal proceedings, and vice versa.

The 3-week deadline to file a claim: your most important deadline

No matter how flawed the suspicion-based dismissal is: if you don't defend yourself in time, it becomes valid. Under § 4 KSchG, you must file an unfair dismissal claim at the labour court within 3 weeks of receiving the written dismissal. This deadline also applies to extraordinary dismissals. If you let it lapse, the dismissal is generally deemed valid from the outset, even if the hearing was missing and the suspicion was on shaky ground.

A letter of objection to your employer, an email to HR, or a request for a conversation don't preserve the deadline. Only a claim received by the labour court in time counts. Our deadline calculator for unfair dismissal claims works out exactly how many days you have left.

By the way, filing a claim doesn't mean you necessarily want to go back to the company. It's initially the tool that keeps your rights open: continued employment, if that's what you want, or termination on significantly better terms. Many proceedings already end at the conciliation hearing with a settlement.

Severance pay after a suspicion-based dismissal: why your position is often strong

There's usually no statutory entitlement to severance pay upon dismissal here either. Even so, a striking number of proceedings involving suspicion-based dismissals end in a settlement including severance pay. There are solid reasons for that:

• Your employer carries the full burden of presentation and proof. They must present and prove the objective facts underlying the urgent suspicion, and that they fulfilled their duty to investigate. With a mere suspicion, that's naturally difficult.
• Hearing mistakes are common. Accusations that are too vague, deadlines that are too short, catching you off guard, a hearing conducted afterwards: any of these mistakes can bring down the whole dismissal, regardless of how much substance the suspicion actually has.
• The litigation risk is expensive for your employer. If they lose, they must continue employing you and pay back wages for the entire duration of proceedings (default of acceptance). Over several months of proceedings, this quickly adds up to a substantial amount.
• Reputational risk: a public trial about unproven accusations, complete with evidence-taking and witnesses from the company, is uncomfortable for many employers. A discreet settlement is often the more convenient route.

As a guide for the amount, the rule of thumb applies: 0.5 gross monthly salaries per year of employment. It's not an entitlement but a negotiating anchor. The shakier the dismissal, the more room there usually is to negotiate above it. What else influences the amount is explained under Severance pay: amount, and for the tax treatment it's worth a look at the one-fifth rule (Fünftelregelung).

Worked example: Miriam fights back against a suspicion-based dismissal

Example: Miriam, with the company for 12 years, earns €4,200 gross a month. She's dismissed without notice because she's suspected of having manipulated expense claims. The "hearing" consisted of a 10-minute conversation in which she was only vaguely confronted with "discrepancies in the accounts", without concrete evidence and without any opportunity to inspect the documents. Miriam signs nothing and files an unfair dismissal claim in time. At the conciliation hearing, it becomes apparent that the hearing barely met the requirements of case law, so the summary dismissal is on shaky ground. Result of the settlement: the employment relationship doesn't end without notice but with notice at the end of the notice period, which is 5 months at 12 years' service. On top of that comes severance pay based on the rule of thumb, and the reason for termination is worded neutrally.

Without fighting back, Miriam would have faced: an immediate stop to her salary, a threatened benefit suspension period, and a summary dismissal leaving a mark on her CV. By fighting back: around €46,200, a neutrally worded end to the relationship, and usually a favourable reference. These figures are an example, not a promise, but they show the leverage involved. To see how long service affects this, take a look at Severance pay after 10 years.

How much could be realistic in your case? Work it out in 2 minutes with our severance calculator.

Benefit suspension risk: what happens to your unemployment benefit?

After a conduct-related dismissal, the employment agency (Agentur für Arbeit) checks for a benefit suspension period (Sperrzeit): under § 159 SGB III, your unemployment benefit is suspended for usually 12 weeks if you gave cause for the dismissal through conduct in breach of your contract, and the total entitlement period is reduced as well.

With a suspicion-based dismissal, though, the situation is particular: you're not accused of proven misconduct, only of a suspicion. Whether the conditions for a suspension period are met is therefore often doubtful and depends on the individual case. This makes fighting back all the more important: a successful unfair dismissal claim or a settlement in which the reason for termination is worded neutrally can often avert the suspension period. You'll find all the details, exceptions, and ways out of the suspension period under Benefit suspension period on unemployment benefit.

Regardless of that, register as a jobseeker immediately. Under § 38 SGB III, if there's only a short period between the dismissal and the end of the employment relationship, you must do this within 3 days of becoming aware of it, so with a summary suspicion-based dismissal, ideally on the same day or the day after. This registration is required even if you're contesting the dismissal, and it doesn't harm your claim.

What you should do now

Whether the suspicion-based dismissal is already on the table or only a hearing has been announced: the order of your next steps helps determine the outcome. You'll find the full guide for the worst case under Received a dismissal: what to do? Here's the short version for the suspicion scenario:

1. Don't sign anything, don't admit anything spontaneously. Neither at the hearing nor afterwards. No "harmless" record either, and no termination agreement, no matter how much pressure is applied.
2. Have the accusations put in writing and ask for time to consider. That's your good right, and it gives you time for a well-considered response.
3. Note the date you received the dismissal. The 3-week deadline to file a claim runs from this day. Keep the envelope and letter and document the circumstances of receipt.
4. Secure evidence. Employment contract, statements, emails, rotas, names of possible witnesses: anything that undermines the suspicion or documents how the hearing went.
5. Register as a jobseeker immediately (§ 38 SGB III), regardless of whether you file a claim.
6. Have your case reviewed legally. Whether the hearing was properly conducted, the 2-week deadline was met, and how solid the suspicion is, can usually be assessed quickly, and your strategy follows from that: continued employment or termination against severance pay.

First get a picture of your leverage: The severance calculator shows you your personal guide figure in 2 minutes.

How can we help you?

A suspicion-based dismissal hits you twice: your job is gone, and there's an unproven accusation hanging over you. In exactly this situation, we review your case together with lawyers specialising in employment law: was the hearing properly conducted? Does the suspicion hold up? Was the 2-week deadline met? And what's realistically achievable, continued employment or termination on good terms?

We carry the risk: purely success-based, no upfront cost. Start with a first assessment through our severance calculator, it only takes 2 minutes, and keep the 3-week deadline in mind.